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Strategic planning is the activity where entrepreneurs sets right priorities, identifies proper business resources and enables the conducive environment for both employees and customers. Small firms with a well-laid strategy enjoy numerous benefits as compared to large companies. Some of the benefits accrued in small firms as a result of strategic planning range from control, profits and social relationship. This paper will analyze the various ways in which strategic planning benefits small companies.
First, strategic planning helps in controlling small companies. Strategic planning will direct small companies to set well-laid goals and enhance the independence of the owner, which eventually results in making innovative decisions (Scarborough & Cornwall, 2015). Furthermore, entrepreneurs will work with confidence and determination to fulfill their desires in business.
Secondly, strategic planning helps firms in maximizing profits and minimizing the outputs. This is for the reason that strategic planning enhances accountability of the expenses incurred by a company. The company can quickly identify the department that is not profitable and acts on it accordingly (Scarborough & Cornwall, 2015). Thus, a small business with a good plan equips itself with appropriate technology that is cost effective and environmentally friendly.
Thirdly, strategic planning in a small company enables workers to trust and easily recognize their potential customers that they have served for a longer time. Mutual understanding, trust, transparency and accountability between a small company and the society are easily built through strategic planning (Scarborough & Cornwall 2015). The result of a good relationship is that the company’s image will expand the company’s market.
According to the survey on strategic planning, it is true to conclude that small companies with a clear strategic plan are manageable, profitable and successful. Confidence and trust are not only enhanced among workers but also among the customers getting services from the small companies.
Scarborough, N. & Cornwall, J. (2015). Entrepreneurship and Effective Small Business Management, 11th Ed. Pearson
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